4 things the feds should do instead of protecting newspapers

The federal government has lots of important issues it needs to deal with these days. It doesn’t need to deal with protecting newspapers. It shouldn’t protect newspapers. It can’t afford to protect with newspapers.

The Federal Trade Commission wasted taxpayers’ money on a hearing last December on whether the government should take some action to prop up the nation’s faltering newspaper industry. The discussion will continue June 15 and an FTC staff report on discussion points makes clear that this exercise isn’t about saving journalism, but about saving newspapers.

I’ll address the substance of the report shortly. But first, I want to list four legitimate areas of government concern that aren’t getting enough attention:

Government needs to prevent and clean up environmental disasters. The pathetic government oversight of oil drilling, the lack of preparation for a deep-water drilling disaster and the slow, ineffective response to the BP catastrophe are all major government responsibilities that dwarf any obligation to bail out newspaper companies that have failed to innovate.

Government needs to protect coal miners. The abysmal enforcement of worker safety standards, especially in the mining industry, needs government attention before the feds spend another nickel trying to protect newspapers.

Government needs to rein in its debt. Federal deficits are out of control. We need to cut spending and raise taxes to reduce and eventually eliminate the deficit and reduce the debt. Until then, we can’t afford to waste a nickel propping up inefficient newspapers or a dime studying the issue.

Government needs to hold the financial industry accountable. I’m not expert enough to know whether the financial reforms passed by Congress were strong enough. But I do know that a newspaper bailout isn’t as important as preventing the sort of ripoffs that caused the 2008 economic meltdown and stopping the continuing ripoffs of taxpayer dollars. Everyone from the government to homeowners to investors needs protection from that sort of calamity, and we need to shift resources that are not being spent wisely into regulation of the financial industry.

As I have written before, we don’t need the government to take a bigger role in journalism. The First Amendment guarantees a free press. A press accepting the sort of help being considered would not be independent enough to perform its watchdog role. Furthermore, government intervention is not needed. Yes, newspapers have seen historic declines in advertising revenues and huge resulting job cuts. The FTC staff report gives heavy attention to newspaper problems but scant attention to the entrepreneurship that is producing an encouraging variety of digital journalism startups (including the TBD operation we will be launching in Washington this summer). Government subsidies decide winners and losers and we don’t need that in the watchdog sector of the economy. The market will do a fine job at deciding the winners and losers.

Jeff Jarvis (and Howard Owens in tweets like the one featured above and in comments on Jarvis’ blog) critiqued the FTC report in more detail than I will. But I will note that the report betrayed a strong bias by uncritically parroting extensively from the report by Len Downie and Michael Schudson and the book by Robert McChesney and John Nichols, both of which advocate heavy government subsidies and both of which have serious shortcomings that I have already addressed. Those men did a fine job of chronicling the history of postal subsidies and other government assistance to newspapers and broadcasting, and of subsidies in European countries with strong journalism institutions. But they cannot be taken seriously because they ignore the current political environment of the United States, where any subsidy would need to be enacted.

The report also says with no footnote or citation (in a report with 180 footnotes): “Studies have shown that newspapers typically provide the largest quantity of original news to consumers over any given period of time.”

Well, I have documentedsignificant and deliberate holes in one of the most prominent (and often-cited) such reports, How News Happens, the “study” of Baltimore media by the Pew Research Center’s Project for Excellence in Journalism. The oft-cited finding that 95 percent of original reporting comes from traditional media was entirely bogus. Beyond the fact that the project studied only six stories, the researchers deliberately excluded a blog doing original reporting on one of those stories from the data on which that 95-percent figure was based. And in another story that certainly would have produced a substantial stream of tweets from citizens reporting facts that later ended up in professional media reports, Pew studied only the Twitter feeds of the Baltimore police and of media outlets.

The statement that newspapers provide the most original news may in fact be true. They certainly still have huge news-gathering staffs. However, no organization, to my knowledge, has studied how many breaking news stories are reported on Twitter before appearing in traditional media, though I have compiled extensive anecdotal evidence that citizen tweets routinely scoop traditional media. (Don’t look for any analysis of Twitter or other social media in the shallow, newspaper-focused FTC report.)

The FTC should cancel its June 15 discussion about newspapers. The government should fire the employees who are wasting taxpayer resources in this biased, unnecessary study and use the money to hire some more oil-rig inspectors.

Most of this proposal can best be described as the sound of “the other shoe dropping” as legacy publishers try to manage their strategies for paid content. In other words: Readers will pay one way or another.

However, some of the latter points like allowing newspapers to be organized as different types of tax-exempt corporations could mesh with fresh ideas about creating new entrepreneurial opportunities in the market.

Case in point: I founded a social network in 2004 and within three months founded a 501(c)(3) to operate it because the purpose of the new platform was clearly educational.

Our company proved the case to IRS who gave us approval as a full-fledged charity. Six years ago that approval process was complex even though our board had collected a clear mountain of evidence to support our educational claim. We won, but it was not without a fight.

So, I like the idea of giving news/education entrepreneurs like myself new opportunities to build new businesses that help improve the knowledge and impact of good journalism. Our vision in 2004 was seeing that a social network could operate as a virtual classroom. Trust me on this: That was a radical concept six years ago.

So let’s do support all new opportunities that support our journalism habits. But let’s not dismiss all of the ideas presented because of the overriding smell of protectionism.

As for nonprofits and L3C’s, I wouldn’t necessarily oppose measures to enable more journalism innovation in those spheres. But I fear that any legislation or regulation in that area would be part of a broad offensive to protect newspapers at the cost of digital entrepreneurs. Nonprofits are moving aggressively into investigative reporting and community news with the current regulations. I would rather live with the current rules than support some worthy changes that came as part of a sweeping newspaper-protection effort. And I think any suggestion that the nonprofit tweaks could happen without a major push to include newspaper subsidies is naive.

Thank you for the link! You have a deeper understanding of the media and newspaper industry than I expect to gain any time soon. The upcoming meeting on June 15 would provide an opportunity for people to give similar feedback on all of the recommendations. People could also voice support for the portion that shows promise for cost savings at government through publishing public data online, along with the innovation that could be enabled therein.

I’ve got a big issue with “original reporting” and the presumption that newspaper reporters are proactive. In many, many cases, newspapers are reactive. How many stories do you read that are the result of:

The highest purpose of any entity is self-preservation. While the newspaper industry goes about the messy business of dying, some parts of it continue to wield significant political influence.

That’s why newspapers cannot be trusted to act in the interest of Journalism. If they did, they would pull the plug immediately on the print product. By continuing legacy operations, they siphon-off so many resources that no journalism can be financially viable.

I wrote about this in more depth in “Circling the Drain” on The Digital Journalist http://bit.ly/cszl01

[…] by reviving the gas guzzlers of the 1960s. Steve Buttry of the new Washington news site TBD chimed in, too, homing in on the assertion that newspapers provide the overwhelming majority of our original […]

[…] by reviving the gas guzzlers of the 1960s. Steve Buttry of the new Washington news site TBD chimed in, too, homing in on the assertion that newspapers provide the overwhelming majority of our original […]

[…] “The FTC defines journalism as what newspapers do,” Jarvis writes, “and aligns itself with protecting the old power structure of media.” Jarvis acknowledges that the FTC does not endorse any of the policies it is considering in the Discussion Draft, but that the tone and perspective from which it is written is troubling to him. Jarvis notes, “it’s the document’s perspective that I find essentially corrupt.” This “tone and perspective” argument was later echoed by Steve Buttry. […]